Premium content from Motley Fool Share Advisor UK
Our monthly Ice Best Buys Now are designed to highlight our team’s three favourite, most timely Buys from our growing list of income-focused Ice recommendations, to help Fools build out their portfolios.
“Best Buys Now” Pick #1:
Primary Health Properties (LSE:PHP)
- Primary Health Properties has been steadily growing its net rental income, earnings and dividends over the past five years.
- Its healthcare real estate portfolio is let on long-term leases, backed by a secure covenant, and mainly (90%) funded directly or indirectly by government bodies. The average length of leases is 11.4 years with an occupancy rate standing at 99.7%.
- This type of business seems recession-resistant. Adding a low-risk and non-cyclical share could reduce the overall volatility of a Foolish portfolio.
- Primary Health successfully refinanced a number of loan facilities in 2021, resulting in annualised interest cost savings of £5m. With a loan-to-value of 43.1% and an average cost of debt of 2.9%, we moved the shares back to a “Buy” earlier this year.
- The ageing demographics and demand for the upgrade of healthcare infrastructure in the UK and Ireland are long-term tailwinds for the company.
